RenewablePortfolioStdsOIR III Admin CPUC Draft Dec 20091117 01 by tMlR88

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									                                      DRAFT

         PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

                                                            ID #9039
ENERGY DIVISION                                             RESOLUTION E-4263
                                                            December 17, 2009
                                   REDACTED

                            R E S O L U T I O N

      Resolution E-4263. Southern California Edison (SCE) Company.
      PROPOSED OUTCOME: This Resolution approves a renewable
      portfolio standard power purchase agreement (PPA) with Ventura
      Regional Sanitation District (VRSD)

      ESTIMATED COST: This Resolution approves cost recovery for a
      renewable energy PPA priced at $100.43/MWh.

      By Advice Letter 2356-E filed on July 1, 2009.

         __________________________________________________________

SUMMARY

Southern California Edison’s Ventura Regional Sanitation District (VRSD)
contract complies with the Renewables Portfolio Standard (RPS) procurement
guidelines and is approved
Southern California Edison (SCE) filed advice letter (AL) 2356-E on July 1, 2009
requesting Commission review and approval of a renewable energy power
purchase agreement (PPA) executed with VRSD.

                                                            Expected
 Generating                  Term     Capacity     Energy
                 Type                                        Online    Location
  facility                  (Years)    (MW)        (GWh)
                                                              Date
 Toland         Landfill      10          1.57-5   9.63-     Online     Ventura
 Road             gas                              30.66                County,
 Landfill                                                                 CA

The bilateral contract resulted from SCE’s 2008 Biomass Program, the precursor
to SCE’s Renewable Standard Contracts Program, described below, and is



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SCE AL 2356-E/AB1

consistent with SCE’s 2008 RPS Procurement Plan, which was approved by the
Commission in D.08-02-008.

AL 2356-E is approved without modification.

NOTICE

Notice of AL 2356-E was made by publication in the Commission’s Daily
Calendar. SCE states that a copy of the Advice Letter was mailed and distributed
in accordance with Section 3.14 of General Order 96-B.

PROTESTS

Advice Letter 2356-E was not protested.

DISCUSSION

Overview Of RPS Program
The RPS Program administered by the Commission requires each utility to
increase its total procurement of eligible renewable energy resources by at least
1% of retail sales per year so that 20% of the utility’s retail sales are procured
from eligible renewable energy resources no later than December 31, 2010.1
Additional background information about the Commission’s RPS Program,
including links to relevant laws and Commission decisions, is available at
http://www.cpuc.ca.gov/PUC/energy/Renewables/overview.htm and
http://www.cpuc.ca.gov/PUC/energy/Renewables/decisions.htm.


SCE’s Renewable Standard Contracts Program For Projects 20 MW And Under
SCE has a Renewable Standard Contracts Program (RSC Program) available to
any eligible renewable energy resource 20 MW and under. SCE offers three
different standard contracts for projects of different sizes: less than 1 MW; 1 MW



1   See Pub. Utils. Code § 399.15(b)(1).




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to 5 MW; and greater than 5 MW to 20 MW. The standard contracts are offered
for terms of 10, 15, and 20 years and are set at the market price referent (MPR).

SCE Requests Commission Approval Of A Renewable Energy Contract
On July 1, 2009, SCE filed AL 2356-E seeking approval of a long term power
purchase agreement (PPA) between SCE and Ventura Regional Sanitation
District for energy from a new landfill gas facility. The bilateral agreement
results from SCE’s 2008 Biomass Program, the precursor to SCE’s RSC Program.
The PPA is priced at the 2008 MPR. The developer and seller of the facility is
VRSD, an enterprise public agency in Ventura County, California that treats and
disposes of solid waste and wastewater. The VRSD facility is located in Ventura
County, CA at the Toland Road Landfill and will deliver baseload energy to SCE.
The project utilizes Ingersoll Rand microturbines, a type of turbine which has
operated commercially at multiple landfill gas sites since 2002. The initial size of
the project is 1.57 MW and is expected to increase to 3.07 MW, assuming the
addition of one new 250 kW microturbine every 18 months. The size of the
project is not to exceed 5 MW. Since AL 2356-E was filed, the VRSD project has
achieved commercial operation.

SCE requests that the Commission issue a resolution containing the following
findings:

    1. Approval of the VRSD Contract in its entirety;

    2. A finding that any electric energy sold or dedicated to SCE pursuant to the
       VRSD Contract constitutes procurement by SCE from an eligible
       renewable energy resource (“ERR”) for the purpose of determining SCE’s
       compliance with any obligation that it may have to procure from ERRs
       pursuant to the RPS Legislation2 or other applicable law concerning the
       procurement of electric energy from renewable energy resources;

    3. A finding that all procurement under the VRSD Contract counts, in full
       and without condition, towards any annual procurement target

2 As defined by SCE, "'RPS Legislation' refers to the current State of California Renewable
Portfolio Standard program statute, as codified at California Public Utilities Code Section 399.11
et seq."




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SCE AL 2356-E/AB1

      established by the RPS Legislation or the Commission which is applicable
      to SCE;

   4. A finding that all procurement under the VRSD Contract counts, in full
      and without condition, towards any incremental procurement target
      established by the RPS Legislation or the Commission which is applicable
      to SCE;

   5. A finding that all procurement under the VRSD Contract counts, in full
      and without condition, towards the requirement in the RPS Legislation
      that SCE procure 20 percent (or such other percentage as may be
      established by law) of its retail sales from ERRs by 2010 (or such other date
      as may be established by law);

   6. A finding that the VRSD Contract, and SCE’s entry into the VRSD
      Contract, is reasonable and prudent for all purposes, including, but not
      limited to, recovery in rates of payments made pursuant to the VRSD
      Contract, subject only to further review with respect to the reasonableness
      of SCE’s administration of the VRSD Contract; and

   7. Any other and further relief as the Commission finds just and reasonable.

Energy Division Review Of The Proposed PPA
Energy Division evaluated the PPA for the following criteria:
    Consistency with SCE’s 2008 RPS Procurement Plan (Plan)
    Consistency with the resource needs identified in SCE’s Plan
    Consistency with RPS standard terms and conditions (STC)
    Consistency with bilateral contracting guidelines
    Project viability
    Consistency with the Interim Emissions Performance Standard
    Procurement Review Group (PRG) participation
    Comparison to the results of SCE’s 2008 solicitation
    Cost reasonableness




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Consistency With SCE’s 2008 RPS Procurement Plan
California’s RPS statute requires that the Commission review the results of a
renewable energy resource solicitation submitted for approval by a utility.3 The
Commission reviews the results to verify that the utility conducted its solicitation
according to its Commission-approved procurement plan. SCE’s 2008 RPS
Procurement Plan (Plan) was conditionally approved by D.08-02-008 on February
14, 2008. As ordered by D.08-02-008, on February 29, 2008 SCE filed and served
its amended 2008 Plan. Pursuant to statute, SCE’s Plan includes an assessment of
supply and demand to determine the optimal mix of renewable generation
resources, as well as bid solicitation materials, including a pro-forma agreement
and bid evaluation methodology documents.4
Specifically, SCE’S Plan states that SCE seeks to procure renewable resources to
augment those under contract from prior solicitations and those executed
pursuant to the 2006 and 2007 solicitations. Specifically, SCE’s Plan states that
SCE intends to secure resources from its 2008 solicitation, as necessary, to ensure
that it meets the 20% RPS goal as soon as possible, and with a reasonable margin
of safety. SCE requested proposals based upon standard term lengths of 10, 15
or 20 years or a non-standard delivery term of no less than 1 month. SCE also
requested proposals with a minimum capacity of 1.5 MW. SCE indicated a
preference for projects:
     With near-term deliveries
      Located in California or outside of California if the seller complies with all
       requirements pertaining to “Out-of-State Facilities” as set forth in the
       California Energy Commission (CEC) Guidebook for RPS eligibility
      Delivered within the CAISO Control Area, but considered proposals for
       facilities interconnected to the Western Electricity Coordinating Council
       (WECC) transmission system
The VRSD project meets SCE’s resource needs because it is an in-state, eligible
renewable resource. The facility is operating and immediately available to
deliver renewable energy within California.


3   Pub. Utils. Code, Section §399.14.
4   Pub. Utils. Code, Section §399.14(a)(3).




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The PPA is consistent with SCE’s 2008 Procurement Plan.

Consistency With RPS Standard Terms And Conditions (STCs)
The PPA includes the Commission-adopted RPS standard terms and conditions,
including those deemed “non-modifiable”.

Consistency With Bilateral Contracting Guidelines
In D.09-06-050 the Commission determined that bilateral contracts should be
reviewed according to the same processes and standards as contracts that come
through a solicitation. AL 3477-E was submitted before that decision was
effective. Although Energy Division did not require an Independent Evaluator
report, it compared the VRSD Contract to SCE’s 2008 solicitation results and
found that it compared favorably to SCE’s shortlisted offers. In addition, Energy
Division conducted its review of the PPA based on the four requirements
identified in D.06-10-019.
The PPA is consistent with the bilateral contracting guidelines established in
D.06-10-019.
    1. The PPA will not be applied to SCE’s cost limitation.5
    2. The PPA was submitted by advice letter.6
    3. The PPA is at least one month in duration.7
    4. The PPA is reasonably priced.8


5 The PPA is ineligible for the cost limitation because it did not result from a
competitive solicitation. Pub. Utils. Code §399.15(d)(2).

6 “For now, utilities’ bilateral RPS contracts, of any length, must be submitted for
approval by advice letter.” D.06-10-019 at 31.
7 “All RPS-obligated LSEs are also free to enter into bilateral contracts of any length
with RPS-eligible generators, as long as the contracts are at least one month in duration,
to enable the CEC to verify RPS procurement claims.” D.06-10-019 at 29.
8 The contract price of bilaterals must be deemed reasonable by the Commission. D.06-
10-019, at 31.




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Project Viability
Since AL 2356-E was filed, the VRSD contract achieved commercial operation, so
there is no project development risk. Further, the Toland Landfill has an existing
permit to accept solid waste for approximately another 50 years. VRSD used
reliable forecasting techniques to determine the expected level of output from the
landfill and is expected to meet the energy delivery requirements outlined in the
PPA.
Also, the developer is experienced – VRSD owned and operated an Ingersoll
Rand 70 kW microturbine for on-site generation and sold the excess energy to
SCE under a 100 kW-and-less standard offer contract that began in 2004.

SCE asserts that the VRSD project is highly viable with minimal development
risk.

Compliance With The Interim Greenhouse Gas Emissions Performance
Standard (EPS)
California Pub. Utils. Code §§ 8340 and 8341 require that the Commission
consider emissions costs associated with new long-term (five years or greater)
power contracts procured on behalf of California ratepayers.
D.07-01-039 adopted an interim EPS that establishes an emission rate quota for
obligated facilities to levels no greater than the greenhouse gas (GHG) emissions
of a combined-cycle gas turbine power plant. The EPS applies to all energy
contracts for baseload generation that are at least five years in duration. 9
Renewable energy contracts are deemed compliant with the EPS except in cases
where intermittent renewable energy is firmed and shaped with generation from
non-renewable resources.

The EPS does not apply to the PPA because it concerns an in-state RPS-eligible
facility.



9 “Baseload generation” is electricity generation at a power plant “designed and
intended to provide electricity at an annualized plant capacity factor of at least 60%.”
Pub. Utils. Code § 8340 (a).




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Procurement Review Group (PRG) Participation
SCE’s PRG consists of representatives from: the Division of Ratepayer Advocates
(DRA), The Utility Reform Network (TURN), California Utility Employees, the
Union of Concerned Scientists, Aglet Consumer Alliance, the California
Department of Water Resources, and the Commission’s Energy and Legal
Divisions.
Pursuant to D.02-08-071, SCE’s Procurement Review Group (PRG) was consulted
regarding the PPA. SCE presented the PRG with details of its Biomass Program
in April 2007, and information about its RSC Program in early 2009. On
February 4, 2009 SCE presented its recommendation to its PRG to execute the
VRSD PPA.
Although Energy Division is a member of the PRG, it reserved final judgment on
the PPA until the AL was filed. Energy Division reviewed the transaction
independently of the PRG, and allowed for a full protest period before
concluding its analysis.

Comparison To The Results Of SCE’s 2008 Solicitation
SCE conducted a benefit-to-cost analysis of the VRSD PPA and found that it
compared favorably to the more competitive proposals received in response to
SCE’s 2008 RFP. Confidential Appendix A addresses this analysis in more detail.

The PPA compares favorably to the results of SCE’s 2008 solicitation.


Cost Reasonableness
All of the 2008 Biomass Program contracts are priced at the 2008 MPR. Based on
the 2009 online date and a 10 year contract term, the contract price for this project
is $100.43/MWh.
Confidential Appendix A demonstrates that the total expected costs of the PPA
are reasonable compared to other bids received in response to SCE’s 2008
solicitation.
Provided the generation is from an eligible renewable energy resource, payments
made by SCE under the PPA are fully recoverable in rates over the life of the
PPA, subject to Commission review of SCE’s administration of the PPA.




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SCE AL 2356-E/AB1

RPS ELIGIBILITY AND CPUC APPROVAL
Pursuant to Pub. Utils. Code § 399.13, the CEC certifies eligible renewable energy
resources. Generation from a resource that is not CEC-certified cannot be used to
meet RPS requirements. To ensure that only CEC-certified energy is procured
under a Commission-approved RPS contract, the Commission has required
standard and non-modifiable “eligibility” language in all RPS contracts. That
language requires a seller to warrant that the project qualifies and is certified by
the CEC as an “Eligible Renewable Energy Resource,” that the project’s output
delivered to the buyer qualifies under the requirements of the California RPS,
and that the seller use commercially reasonable efforts to maintain eligibility
should there be a change in law affecting eligibility.10

The Commission requires a standard and non-modifiable clause in all RPS
contracts that requires “CPUC Approval” of a PPA to include an explicit finding
that “any procurement pursuant to this Agreement is procurement from an
eligible renewable energy resource for purposes of determining Buyer's
compliance with any obligation that it may have to procure eligible renewable
energy resources pursuant to the California Renewables Portfolio Standard
(Public Utilities Code Section 399.11 et seq.), Decision 03-06-071, or other applicable
law.”11

Notwithstanding this language, the Commission has no jurisdiction to determine
whether a project is an eligible renewable energy resource, nor can the
Commission determine, prior to final CEC certification of a project, that “any
procurement” pursuant to a specific contract will be “procurement from an
eligible renewable energy resource.”

Therefore, while we include the required finding here, this finding has never
been intended, and shall not be read now, to allow the generation from a non-
RPS eligible resource to count towards an RPS compliance obligation. Nor shall
such a finding absolve any contracting party of its obligation to obtain CEC
certification and/or to pursue remedies for breach of contract to ensure that only
RPS-eligible generation is delivered and paid for under a Commission-approved

10   See, e.g. D. 80-04-009 at Appendix A, STC 6, Eligibility.
11   See, e.g. D. 80-04-009 at Appendix A, STC 1, CPUC Approval.




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SCE AL 2356-E/AB1

contract. Such contract enforcement activities shall be reviewed pursuant to the
Commission’s authority to review the administration of such contracts.

CONFIDENTIAL INFORMATION

The Commission, in implementing Pub. Utils. Code § 454.5(g), has determined in
D.06-06-066, as modified by D.07-05-032, that certain material submitted to the
Commission as confidential should be kept confidential to ensure that market
sensitive data does not influence the behavior of bidders in future RPS
solicitations. D.06-06-066 adopted a time limit on the confidentiality of specific
terms in RPS contracts. Such information, such as price, is confidential for three
years from the date the contract states that energy deliveries begin, except
contracts between IOUs and their affiliates, which are public.
Confidential Appendix A, marked "[REDACTED]" in the public copy of this
resolution, as well as the confidential portions of the advice letter, should remain
confidential at this time.


COMMENTS ON THIS RESOLUTION

Public Utilities Code section 311(g)(1) provides that this resolution must be
served on all parties and subject to at least 30 days public review and comment
prior to a vote of the Commission. Section 311(g)(2) provides that this 30-day
period may be reduced or waived upon the stipulation of all parties in the
proceeding. The 30-day comment period for the draft of this resolution was
neither waived nor reduced.

FINDINGS
1. The PPA is consistent with SCE’s 2008 RPS Procurement Plan.
2. The PPA is consistent with the resource needs identified in SCE’s 2008
   Procurement Plan.
3. The PPA includes the Commission-adopted RPS standard terms and
   conditions, including those deemed “non-modifiable”.
4. The PPA is consistent with the bilateral contracting guidelines established in
   D.06-10-019.
5. SCE asserts that the VRSD project is highly viable with minimal development
   risk.


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SCE AL 2356-E/AB1

6. The EPS does not apply to the PPA because it concerns an in-state RPS-
   eligible facility.
7. Pursuant to D.02-08-071, SCE’s Procurement Review Group (PRG) was
   consulted regarding the PPA.
8. The PPA compares favorably to the results of SCE’s 2008 solicitation.
9. Confidential Appendix A demonstrates that the total expected costs of the
   PPA are reasonable compared to other bids received in response to SCE’s
   2008 solicitation.
10. Provided the generation is from an eligible renewable energy resource,
    payments made by SCE under the PPA are fully recoverable in rates over the
    life of the PPA, subject to Commission review of SCE’s administration of the
    PPA.
11. Procurement pursuant to the PPA is procurement from eligible renewable
    energy resources for purposes of determining SCE’s compliance with any
    obligation that it may have to procure eligible renewable energy resources
    pursuant to the California Renewables Portfolio Standard (Public Utilities
    Code Section 399.11 et seq.), D.03-06-071 and D.06-10-050, or other applicable
    law.
12. The immediately preceding finding shall not be read to allow generation
    from a non-RPS eligible renewable energy resource under this PPA to count
    towards an RPS compliance obligation. Nor shall that finding absolve SCE of
    its obligation to enforce compliance with Standard Term and Condition 6, set
    forth in Appendix A of D.08-04-009, and included in the PPA.
13. Confidential Appendix A, marked "[REDACTED]" in the public copy of this
    resolution, as well as the confidential portions of the advice letter, should
    remain confidential at this time.
14. Advice Letter 2356-E should be approved effective today.


THEREFORE IT IS ORDERED THAT:

1. The proposed renewable energy contract between Southern California Edison
   (SCE) and Ventura Regional Sanitation District in Advice Letter 2356-E is
   approved without modification.
2. This Resolution is effective today.



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SCE AL 2356-E/AB1

I certify that the foregoing resolution was duly introduced, passed and adopted
at a conference of the Public Utilities Commission of the State of California held
on December 17, 2009; the following Commissioners voting favorably thereon:




                                                    _______________
                                                    PAUL CLANON
                                                    Executive Director




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SCE AL 2356-E/AB1



                    Confidential Appendix A
                    Contract Price Analysis
                         [REDACTED]




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                        Appendix B
                    Terms and Conditions




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         Term/Condition

   Type of Purchase
                              Renewable
   (Renewable, etc)

   IOU Ownership Option       N/A – public agency

                                      The VRSD Contract is effective on April 2, 2009
                              (“Effective Date”). Within 90 days of the Effective Date,
                              SCE shall file with the Commission the appropriate
                              request for Commission approval.

                                      To the extent not already obtained, VRSD shall
                              expeditiously seek CEC Certification and Verification
                              and all Permits.

                                      The term of the VRSD Contract shall commence
                              upon Initial Operation and shall end on the last day of
                              the calendar month which is 10 Term Years from the
                              month of the Firm Operation Date. Prior to the
                              commencement of the Term, the following shall have
                              occurred:

                                          VRSD shall obtain a FERC-accepted
                                           interconnection agreement to interconnect
   Conditions Precedent and
                                           the Generating Facility to SCE’s electric
   Date Triggers
                                           system;

                                          VRSD shall have complied with the contract
                                           requirements in Section 3.11(c) of the
                                           contract;

                                          SCE shall have been authorized by the
                                           CAISO to schedule the electric energy
                                           produced by the generating facility with the
                                           CAISO;

                                          The generating facility shall be operating in
                                           parallel with the applicable transmission
                                           provider’s electric system; and

                                          VRSD shall be forecasting and delivering
                                           electric energy to SCE at the delivery point.




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         Term/Condition

   Average Actual Price
                                   $100.43/MWh
   ($/MWh)

   Product Type                    Biomass (landfill gas)

   Key Contract Dates (initial     The plant is beginning deliveries to SCE under this
   startup deadline,               contract in June, 2009. The Initial Operation Date shall
   commercial operation            be on or before December 31, 2009. The Startup
   deadline, PTC deadline, etc.)   Deadline is July 31, 2010. There is no PTC Deadline.

   Firming/Shaping
                                   None
   Requirements

   Expected Payments               $14,097,152

   Scheduling Coordinator          SCE

                                   During the Startup Period, VRSD shall be responsible
                                   for all CAISO Charges and CAISO Sanctions, if any,
                                   attributable to or assessed for test energy delivered by
                                   VRSD to the real-time market (and any other CAISO
                                   administered market that may from time to time be
                                   implemented.

   Allocation of CAISO (or         Commencing upon Initial Operation and continuing
   other control area) Charges     throughout the Term, VRSD has no responsibility for
                                   CAISO Charges attributable to or assessed for energy
                                   delivered by VRSD to SCE.

                                   In the event VRSD fails to comply with the Forecasting
                                   provisions or any CAISO Tariff or CAISO directives,
                                   VRSD may be liable to pay an SCE Penalty or CAISO
                                   Sanction.

                                   There is no congestion at the delivery point because the
   Allocation of Congestion        first point of interconnection is SCE’s distribution
   Risk                            system. SCE bears the congestion risk on its
                                   distribution system.

   Project Development
                                   None
   Security

                                   VRSD may elect to extend the Startup Deadline by
   Daily Delay Damages
                                   paying to SCE Daily Delay Liquidated Damages in an



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         Term/Condition

                              amount equal to twenty cents ($0.20) per kW of
                              Contract Capacity per day for each day (or portion
                              thereof)

   VRSD-Required              90% of VRSD’s Expected Annual Net Energy
   Performance                Production

   Assurances (calculation
   methodology, form of PA    None
   and amount)

   IOU-Required Performance
   Assurances (calculation
                              SCE does not post any performance assurances
   methodology, form of PA
   and amount)

   Availability Guarantees    None

   Energy Delivery
                              Contract Capacity x 0.7 x 8,760 in each term year
   Requirements

                              VRSD may elect to extend the Startup Deadline by
                              paying to SCE Daily Delay Liquidated Damages in an
                              amount equal to twenty cents ($0.20) per kW of
                              Contract Capacity per day for each day (or portion
                              thereof)

                              If in any Term Year VRSD fails to meet its Annual
   Liquidated Damages/        Energy Delivery Obligation, then VRSD shall be subject
   Penalties for Failure to   to an Energy Replacement Damage Amount penalty
   Perform                    calculated as: (A – B – C) x D where:
                                      A = VRSD’s Annual Energy Delivery
                                             Obligation in kWh
                                      B =    Sum of Qualified Amounts over the
                                             Term Year in kWh
                                      C = Sum of Lost Output over the Term Year
                                             in kWh
                                      D = Two Cents ($0.02) per kWh


                              No Default for Force Majeure.
   Force Majeure Provisions   Neither Party shall be considered to be in default in the
                              performance of any of its obligations set forth in this
                              Agreement (except for obligations to pay money) when


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       Term/Condition

                        and to the extent failure of performance is caused by
                        Force Majeure.

                        Requirements Applicable to the Claiming Party.

                        If a Party, because of Force Majeure, is rendered wholly or
                        partly unable to perform its obligations when due under this
                        Agreement, that Party (the “Claiming Party”), shall be
                        excused from whatever performance is affected by the Force
                        Majeure to the extent so affected.

                        In connection with a claim of Force Majeure:

                                 (a) The Claiming Party, within fourteen (14) days
                                     after the later of (i) the initial occurrence of the
                                     claimed Force Majeure, or (ii) the date on
                                     which the claimed Force Majeure first prevents
                                     or delays performance under this Agreement,
                                     must give the other Party Notice describing the
                                     particulars of the occurrence; and

                                 (b) The Claiming Party must provide timely
                                     evidence reasonably sufficient to establish that
                                     the occurrence constitutes Force Majeure as
                                     defined in this Agreement.

                        The suspension of the Claiming Party’s performance
                        due to Force Majeure shall be of no greater scope and of
                        no longer duration than is required by the Force
                        Majeure.
                        In addition, the Claiming Party shall use commercially
                        reasonable and diligent efforts to remedy its inability to
                        perform.
                        This section shall not require the settlement of any
                        strike, walkout, lockout or other labor dispute on terms
                        which, in the sole judgment of the Claiming Party, are
                        contrary to its interest.
                        It is understood and agreed that the settlement of
                        strikes, walkouts, lockouts or other labor disputes shall
                        be at the sole discretion of the Claiming Party.
                        When the Claiming Party is able to resume
                        performance of its obligations under this Agreement,
                        the Claiming Party shall give the other Party prompt
                        Notice to that effect.



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        Term/Condition


                                Termination.
                                Either Party may terminate this Agreement on Notice,
                                which shall be effective five (5) Business Days after
                                such Notice is provided, in the event of Force Majeure
                                which prevents substantial performance by the other
                                Party and which extends for more than three hundred
                                sixty five (365) consecutive days.

                                Either Party shall have the right to terminate this
                                Agreement on Notice, which shall be effective five (5)
                                Business Days after such Notice is given, in the event
                                CPUC Approval has not been obtained within three
                                hundred sixty five (365) days after SCE files its request
                                for CPUC Approval and a Notice of termination is
                                given on or before the three hundred ninety fifth
                                (395th) day after SCE files the request for CPUC
                                Approval.

                                Either Party shall have the right to terminate this
   Termination Rights of Both
                                Agreement on Notice, which shall be effective five (5)
   Parties
                                Business Days after such Notice is given in the event
                                CEC Certification and Verification or Permit Approval
                                has not been obtained by VRSD within eighteen (18)
                                months after the Effective Date and a Notice of
                                termination is given on or before the end of the
                                nineteenth (19th) month after the Effective Date.

                                Either Party may also terminate in the event of a Force
                                Majeure which prevents substantial performance by the
                                other Party and which extends for more than three
                                hundred sixty five (365) consecutive days.

   VRSD’s Termination Rights    None, other than specified above

                                SCE shall have the right to terminate this Agreement on
                                Notice which shall be effective five (5) Business Days
                                after such Notice is given on or before the date that is
                                sixty (60) days after VRSD provides to SCE the results
   SCE’s Termination Rights
                                of any Interconnection Study by the CAISO or the
                                Transmission Provider for the Generating Facility if the
                                results of the latest of such studies performed as of the
                                date of the termination Notice reflect that the total cost



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Resolution E-4263                                                December 17, 2009
SCE AL 2356-E/AB1


         Term/Condition

                            of transmission upgrades or new transmission facilities
                            to SCE, or any Transmission Provider under the
                            jurisdiction of the CAISO, that are not paid by VRSD
                            (without reimbursement from SCE or any other
                            Transmission Provider) will exceed fifteen dollars ($15)
                            multiplied by the Contract Capacity in kilowatts


                            VRSD must offer electric energy, Green Attributes,
                            Capacity Attributes and Resource Adequacy Attributes
   Right of First Refusal   generated by or associated with the Generating Facility
                            to SCE for a period of two years after contract
                            termination




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